Rory McIlroy’s legal battle unwelcome blot on Horizon ahead of Grand Slam pursuit

Golfer could spend two weeks on stand when proceedings against former agency begins

 

By rights, Rory McIlroy, the world’s number-one ranked golfer and one of sport’s most marketable figures, should be preparing to smell the azaleas. In April, he will play in the US Masters at Augusta National where, at the age of 25, the Northern Irishman seeks to win the green jacket and claim the career Grand Slam.

Only five men – Jack Nicklaus, Tiger Woods, Ben Hogan, Gary Player and Sam Snead – have achieved the feat in the modern era. He’s touching greatness; but there’s no time for such sweet scents to be inhaled just yet.

Instead, the immediate future holds out the prospect of considerable time being spent in the High Court in Dublin, where McIlroy’s legal action against Horizon Sports Management, his former agent, will be heard. The hearing, which starts on Tuesday, is expected to last for between six to eight weeks.

The player, as the plaintiff, can expect to be in the stand for anything up to two weeks in the early part of proceedings. Golf will have to take a back seat.

The background – as outlined in affidavits and preliminary court hearings – is of a once-sweet relationship that ultimately turned sour. An attempt at mediation, encouraged by the court, was unsuccessful.

How did it ever get to this?

McIlroy – who joined Horizon Sports Management from Chubby Chandler’s ISM stable in December 2011 – set up his own company, Rory McIlroy Incorporated, in September 2013 shortly after initiating legal proceedings against Horizon and two associated entities, Gurteen Ltd and Canovan Management Services.

Loss of commissions

Having left ISM, a company he joined straight from the amateur ranks, McIlroy signed with Horizon at the end of 2011 just months after winning his first Major title at the US Open (allegedly he did so during a Christmas party and without obtaining independent legal advice). He subsequently signed an extension with renewed terms to his contract in March, 2013.

In May of that same year, just over a month after signing the extended contract which was due to run to 2017, McIlroy announced his intention to split from the company.

In his time with Horizon, McIlroy put his signature to one of the most lucrative contract deals in sport, a five-year association with Nike reputed to be worth $100 million (€88.4 million), and also signed significant deals with Bose, the audio equipment company, and Omega, the luxury Swiss watch manufacturers. In September 2013, on the eve of Graeme McDowell’s wedding, legal proceedings against Horizon were issued and, that same month, Rory McIlroy Inc was formally launched.

The preliminary hearings in the dispute have shown intent, from both sides. Just like any golf tournament, this is a battle to be won: among the claims aired in court preliminaries, McIlroy said he was “unambiguously and consistently” led to believe he was on the same commercial terms as Graeme McDowell, who was also a Horizon client at that time; Horizon MD Conor Ridge, in an affidavit, claimed that McIlroy had wiped data from his mobile phones.

In early January, the court refused an application from Horizon seeking orders to inspect the player’s mobile phones and those of Donal Casey, the chief executive of Rory McIlroy Inc, and McIlroy’s chief-of-staff, Seán O’Flaherty. Both men are former Horizon executives.

Casey, a highly regarded businessman who before joining Horizon was managing director for Aon Hewitt and previously chief executive for Irish Life Corporate Business, was involved in the negotiations of the Nike deal through his consultancy K3.

The sponsorship centred on McIlroy wearing Nike clothing and shoes and using their clubs, but did not include the bag: Casey believed keeping the golf bag out of the deal was beneficial for McIlroy and Horizon and entitled him to a cut from any future deals for brand placement on the bag. This, ultimately, led to Casey’s departure.

It also emerged in court preliminaries that Casey’s departure from Horizon (in December, 2012) left an element of unhappiness with the McIlroys. On March 12th, 2013, just over a week after McIlroy walked off the course citing toothache at the Honda Classic and two days after securing a top-10 finish in the WGC-Cadillac championship, Horizon MD Conor Ridge sent an email to O’Flaherty and fellow company director Colin Morrissey detailing the unhappiness of McIlroy’s father, Gerry, with Casey leaving the company.

The next day, O’Flaherty sent an email to Gerry McIlroy highlighting elements in the new contract and urged his son to “tackle” Ridge on the issues.

Later that month, another issue became apparent when it emerged that Ridge had authorised payment of $166,000 (€146,687) to Unicef as a donation. McIlroy, a Unicef ambassador, had planned to pay a humanitarian visit to Haiti that March – just as he had done before winning the US Open in 2011 – but changed his playing schedule to take in a tournament in Texas. Ridge claimed the payment to the charity had been because not paying would have caused “significant reputational damage” to the player. The transaction was reversed after McIlroy expressed dissatisfaction.

Fall out of contention

In turn, Fitzgerald passed on the documents for “commercial and legal advice” to the financier Dermot Desmond, a close acquaintance for a long number of years. Desmond in turn passed the file to Maria O’Sullivan, IIU’s in-house solicitor, who appears to have discounted any clear grounds for termination (of the contract).

In an email to Fitzgerald, Desmond said: “I spoke with Rory and asked him to be upfront with Conor [Ridge] and obtain the legal documents between himself and Horizon.” He also added: “The most important thing now is to get the legal contracts and decide on a strategy for an amicable separation between Rory and Horizon.”

McIlroy’s decision to split from Horizon was announced in May, 2013, by which time O’Flaherty had resigned his position with the company. He would become chief-of-staff in Rory McIlroy Inc and is invariably found by his player’s side before and after tournament rounds.

On its run into court, the dispute also affected the friendship of McIlroy and McDowell’s relationship, with McDowell describing it as “a strain on our relationship”.

The decision of the McIlroy legal team to bring McDowell’s role with Horizon into the court room, as well as some of the terms of his contract – described by Horizon’s solicitors GJ Moloney as a “cynical device” – didn’t go down well with McDowell.

Speaking at the British Open championship at Hoylake, where McIlroy won, McDowell said: “We’re not the same as we used to be and until the legal proceedings are over and done with, there’s always going to be that little bit of tension in the air... but is there anything personal between us? No, there’s nothing personal between us. It’s all business.”

Later in the year, it led to an observation from Phil Mickelson. Commenting ahead of the Ryder Cup in September, Mickelson said: “(At least) we . . . don’t litigate against each other.”

After the Ryder Cup, McIlroy and McDowell – who has since left Horizon after his contract finished – claimed their relationship had been “strengthened”.

Through it all, though, McIlroy has emerged as the world’s most dominant player.

After a disappointing season in 2013 – the year when he split from Horizon and formed his own management company – McIlroy rebounded in 2014 with the best season of his career, winning the British Open and the US PGA titles, along with two other high-profile titles in the BMW PGA at Wentworth and the WGC-Bridgestone Invitational in Akron.

However, McIlroy was compelled to take time out towards the end of last season – missing two WGCs in China, the HSBC and the BMW Masters, due to the need to “prepare for the trial [sic] over my legal dispute with Horizon Sports Management”. That decision to not travel to the Far East came about after mediation talks, suggested by Judge Brian McGovern in preliminary hearing, came to nothing.

Call for mediation

“Is this not a case made for mediation?” he asked Rossa Fanning for McIlroy and Ciaran Lewis for Horizon. “The case has all sorts of complex issues involving relationship matters,” he added.

His call was in vein, however, with the upshot that both sides head into Tuesday facing the prospect of six to eight weeks in court.

In Abu Dhabi recently, where he finished runner-up, McIlroy was asked about the pending court case.

Question: “How confident are you that this court case won’t negatively impact what you’re trying to do over the next three months? A lot of people think that might be a problem and a distraction for you?”

Answer: “No, it’s not at all. I’ve literally not thought about it since whenever I last had to talk to someone about it . . . I just go with what the lawyers say and they tell me to just sit tight and not talk much about it and that’s it.”

Question: “You’re obviously . . .”

Answer: “Why would it? It’s not a big deal. I’ll be okay at the end of the day.”

Question: “Sorry to press you on the court case again, but the fact you might have to go on the stand, surely that must be something that is in your mind?

Answer: “ . . . I just have to get up there and tell the truth. I mean, that’s all I need to do.”

It was Earl Warren, a much respected chief justice in the United States, who once observed: “I always turn to the sports pages first, which records people’s accomplishments. The front page has nothing but man’s failures.”

In this instance, McIlroy’s court case with Horizon will move to the news pages. And a large number of global media outlets are headed to Dublin to document every word.

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